Odisha to lose over Rs 2,000 cr on tax deferment to IOCL

Bhubaneswar: Odisha is set to lose over Rs 2,000 crore in 2016-17 due to deferment of value added tax (VAT) to Indian Oil Corporation’s Paradip oil refinery.

The loss to the exchequer will be 11.42 per cent of the commercial tax target of Rs 17,500 crore fixed by the state government for the 2016-17 financial year.

“It is apprehended that the total deferment of VAT, being availed by IOCL unilaterally in violation of the provisions of the OVAT Act, is likely to exceed Rs 2,000 crore in 2016-17,” said Saswat Mishra, Commercial Tax Commissioner in a letter to Additional Chief Secretary (Finance).

“Such a huge loss cannot be compensated by any other means,” said Mishra.

Against the target of Rs 17,500 crore from commercial tax, the state government has collected Rs 5,530.95 crore by August, 2016 at a growth rate of 4.02 per cent.

“The below par growth rate is mainly on account of deferment of Rs 531.96 crore availed by IOCL’s Paradip refinery, which is 9.62 per cent of cumulative collection till August,” said Mishra.